Tuesday, July 29, 2008

Most Favorable, Least Favorable Business Climates

"A View from Corporate America: Winning Strategies in Economic Development Marketing" is the fifth installment in a series of surveys of senior U.S. executives and their advisors. Similar surveys were conducted by DCI in 1996, 1999, 2002 and 2005. From the 2008 report, the six states with the most favorable business climates are Texas (highest ranking), North Carolina, Geogia, Florida/Tennessee (tie) and Nevada. Among executives who named Texas as having a favorable business climate, the factors mentioned most frequently are: Tax climate (31%); Labor/Workforce (Cost and availability) (29%) and Pro-business climate (26%). Among those who named North Carolina as having a favorable business climate, the factors mentioned most frequently are: Labor (Education levels, cost) (30%); Pro-business climate (22%); and Low costs (19%), mirroring the reasons provided by those who named Georgia: Labor (Low cost, good quality) (32%); Pro-business climate (29%) and Low costs (29%).The five states with least favorable business climates are Califorinia (lowest ranking), New York, Michigan, New Jersey and Massachusetts. California was cited for having “too much regulation and an anti-business climate” by 58% of respondents, while 37% mention “high costs” and 28% said “taxes.” Among those who named New York as having a “least favorable” business climate, the factors mentioned most frequently are taxes (65%), costs (32%) and anti-business regulation/climate (23%). Michigan’s poor economy (34%), high taxes (31%), and unions (17%) earned it a position in this list.

9 Comments:

Some interesting items in this report. One also notes the following passage:

"Asked to rate the importance of several common site selection factors, respondents gave the highest rating to “labor (availability, quality, cost,” following by “overall operating costs” and “efficient transportation systems (highway, rail, air, port).”"

Also of interest was that the majority of respondents said that their company's next expansion would be in the area of "manufacturing/ production plant".

qt, speaking of transportation systems, I read in a report that our nation's transportation infrastructure, or rather the state of it, is costing the US economy something on the order of at least a couple billion dollars or more per year.

I think it's interesting that California and NY are rated as unfavorable business climates, but there are still so many businesses there and a lot of innovation still comes out of those states. It seems that way to me, anyways. Didn't California in the past year or two see the opening of 1 or 2 new car companies? Ahhnold was boasting about one of them in some speech last year.

And why are unions a problem again? Do they get in the way of huge profits or something? I personally think that some unions need to get their act together and some unions make unreasonable demands, but the idea of unions is pretty essential to the protection of the worker, unless you want the government to really really be in your business all the time protecting them. I just don't think that human lives should be dismissed as numbers or capital, as a commodity that can be treated with disdain or indifference.

@ Matt regarding innovation coming out of California : A large part probably has to do with simply having about 1/9 of the US population in one state. It may be awful to do business there, but a lot of businesses will still be there simply due to the population base.

Reading this post made me remember reading an article in the Washington Examiner about this district in LA, where the local governing board banned new fast food places from opening up in the next year, so that more healthy food places and grocery stores would come. The article also went on to mention how in the last 2 years, they've now allowed a WalMart supercenter (which has a grocery store) or a supermarket to open because of concerns it would hurt local businesses, by offering cheap prices. There are so many things wrong with that, I don't know where to begin.

Perhaps some states don't bend over backwards at the expense of the worker. It's the fault of business to be hostile against working with the conditions. Doubly so for unions who only are militant out of the repeated adversity placed upon them.

When I see pro-business, it really means anti-worker. There was a time that it didn't, but that's been well over 30 years ago.

Yeah, no doubt, Boy Wonder. Isn't it great how "business" is a monolithic, robotic entity that thrives without labor inputs? I mean seriously, why should "business" dirty itself with "workers" when it could just capture all of the returns without having to babysit all day?